Mortgage Calculator

A mortgage payment is more than just principal and interest. Property taxes, homeowners insurance, and potentially PMI all add to your true monthly housing cost. This calculator gives you the complete picture so you can budget accurately and compare offers confidently.

How to Use This Tool

Enter the purchase price of the home.
Enter your down payment amount.
Enter the annual interest rate.
Enter the loan term (15 or 30 years are most common).
Enter your annual property tax amount.
Enter your annual homeowners insurance premium.
Click Calculate to see your total monthly payment.

The Formula

Principal & Interest: M = P x [r(1+r)^n] / [(1+r)^n - 1] where P is the loan amount, r is monthly interest rate, and n is total number of payments. Total Monthly Payment = P&I + (Property Tax / 12) + (Insurance / 12).

Why It Matters

You're buying a $400,000 home with $80,000 down (20%) at 6.5% for 30 years. Your principal and interest payment is $2,020/month. Add $400/month for property taxes and $150/month for insurance, and your total monthly payment is $2,570. Over 30 years, you'll pay $327,000 in interest.

Frequently Asked Questions

What is included in a mortgage payment?

A full mortgage payment typically includes: principal (paying down the loan), interest (the cost of borrowing), property taxes (escrowed monthly), and homeowners insurance (escrowed monthly). This is often abbreviated as PITI. If your down payment is less than 20%, you'll also pay PMI (Private Mortgage Insurance) until you reach 20% equity.

Should I choose a 15-year or 30-year mortgage?

A 15-year mortgage has higher monthly payments but saves significantly on total interest and builds equity faster. A 30-year mortgage offers lower monthly payments, more cash flow flexibility, and the option to make extra payments. For a $320,000 loan at 6.5%, a 15-year payment is about $2,778 versus $2,020 for 30 years — a $758 difference. If you can comfortably afford the higher payment, the 15-year saves roughly $177,000 in interest.

How much down payment should I make?

20% down is the traditional target because it eliminates PMI and shows strong financial position. However, conventional loans allow 3% down, FHA loans require just 3.5%, and VA loans require 0% for eligible veterans. Putting less than 20% down means paying PMI, which typically costs 0.5-1% of the loan amount annually. If you can invest the down payment money at a higher return than your mortgage rate, it may make financial sense to put less down.